Banks raising the stake on mutual funds market

The largest banks in the system have found a new battleground over the past twelve months: the mutual fund market. Almost every major Romanian banking group has thrown millions of euros onto the market in recent months, hoping to secure as large a share of the total value of the assets on the market as possible.

The Greek Eurobank, the majority shareholder of Bancpost, announced its entry onto the mutual fund market and is prepared to place 17 million euros in the two funds it will launch right from the outset. The value of the mutual fund assets should subsequently exceed 100 million euros. This move, which is the largest investment by a bank on the mutual fund segment, will turn Bancpost into a top three player on the market.

“We will initially begin with capital accounting for the RON equivalent of 17 million euros, which is sure to propel us into third place, at least, on the mutual funds market. This investment demonstrates our major interest in the market for mutual funds and confidence that this market will witness a strong development in the near future,” Dan Stifter, general manager of Eurobank Mutual Funds Management, Eurobank”s investment management company, told ZIARUL FINANCIAR.

According to the company”s estimates, the value of the assets of the two funds managed by Eurobank, Bancpost Plus and Bancpost Active Balanced, could reach 25 million euros before the end of 2006.

BCR and BRD, the top two banks in the system, are in their turn pursuing a consolidation on the mutual funds market on which BRD is the leading player, and BCR ranks second. Each of the two banks has recently launched a higher risk fund to diversify their offer.

SG Asset Management, the company that manages the assets of BRD-Groupe Société Générale, set out to maintain its leading position on the mutual funds market. It launched a diversified investment fund whereby it intends to recover part of the ground it lost over the past twelve months, when its market share shrank from 48% to 26%. The new fund”s start-up capital will be the equivalent of 2.5 million euros. BRD is currently managing the largest fund on the market, Simfonia 1, whose assets totalled 23.8 million euros at the end of December.

Banca Transilvania in its turn entered the mutual fund market aggressively, with the two funds launched in September having secured a 3.3% market share for the bank, right from the start. The initial investment the bank made in the two funds was of nearly 2.5 million euros. At present, the assets managed by BT Asset Management account for 6.3% of the total market.

However, despite the banks” reign over the market in terms of assets, it is the independent investment managers that are keeping the upper hand. This may soon change, though, as banks have the advantage of the distribution networks they have at their disposal.

The value of the assets of the mutual funds was in excess of 92.2 million euros at the end of December, and growth in 2005 stood at nearly 75%. The number of customers exceeded 71,000 at the end of last month. andrei.chirileasa@zf.ro